Distant enhancers come into proximity with the genes they activate through chromatin looping. In a few cases, proteins that are necessary for these long range interactions have been identified. For example, in the beta-globin locus a complex of the erythroid proteins GATA-1, LMO2 and TAL1 as well as the more widely expressed nuclear factor Ldb1 mediates beta-globin LCR enhancer-gene looping, but the interactive functions of the protein complex members are unknown and it remains unclear what specific requirements there are, if any, beyond looping for transcription activation. We tested the requirements for Ldb1 complex formation and function in the beta globin locus, using as a readout loop formation and transcription activation of beta-globin in the background of Ldb1 knock down erythroid cells. Dimerization through the Ldb1 N-terminal domain was required for beta-globin rescue and looping. However we discovered that deletion of a small conserved region within this domain permitted looping, but not transcription rescue: this region was required for recruitment of RNA polymerase II to the beta-globin gene promoter. Supporting this idea, heterologous dimerization domains fused directly to LMO2 and a tethered LMO2-LMO2 molecule failed to rescue beta-globin transcription. Moreover, while a protein fusion of the Ldb1 dimerization domain to LMO2 was fully capable of rescuing looping and transcription, fusion to GATA-1 was not, revealing a specific requirement for LMO2. These results indicate that chromatin looping and RNA polymerase recruitment to a promoter destined for activation are separate events and begin to reveal the roles of individual factors within the Ldb1 complex. The principles underlying architectural landscape of chromatin beyond the nucleosome level in living cells remains largely unknown despite its potential to play a role in mammalian gene regulation. We investigated the 3-dimensional folding of a 1 Mbp region of human chromosome 11 containing the beta-globin genes by integrating looping interactions of the insulator protein CTCF determined comprehensively by chromosome conformation capture (3C) into a polymer model of chromatin. We find that CTCF-mediated cell type specific interactions in erythroid cells are organized to favor contacts that are known to occur in vivo between the beta-globin locus control region (LCR) and genes. In these cells, the modeled beta-globin domain folds into a globule with the LCR and the active globin genes on the periphery. By contrast, in non-erythroid cells, the globule is less compact with few but dominant CTCF interactions driving the genes away from the LCR. This leads to a decrease in contact frequencies that can exceed 1000-fold depending on the stiffness of the chromatin and the exact positioning of the genes. Our findings show that regional CTCF contacts in mammalian nuclei functionally affect spatial distances between control elements and target genes, and hence contribute to chromosomal reorganization required for transcription.